The following properties fall under the definition of investment property, except

• Land held for long-term capital appreciation

• Property occupied by an employee paying market rent

• Land held for a currently undetermined use

• A building owned by an entity and leased out under an operating lease

In case of property held under an operating lease and classified as investment property

• The entity has to account for the investment property under the cost model only.

• The entity has to use the fair value model only

• The entity has a choice between the cost model and fair value model.

• The entity needs only to disclose the fair value and can use the cost model

Transfers from investment property to property, plant and equipment are appropriate

• When there is change of use.

• Based on the entity’s discretion.

• Only when the entity adopts the fair value model.

• The entity can never transfer property into another classification once it is classified as investment property.

When the entity uses the cost model, transfer between investment property, owner-occupied property and inventory shall be accounted for at

• Carrying amount

• Either at fair value or carrying amount

• Fair value

• Neither at fair value nor carrying amount

The internal sources of information indicating possible impairment include all of the following, except

• Evidence of obsolescence or physical damage of an asset

• Significant change in the manner or extent in which the asset is used with an adverse effect on the enterprise

• Evidence that the economic performance of an asset will be worse than expected

• Significant decrease or decline in the market value of the asset

Costs of disposal are deducted in determining fair value less cost to sell. Examples of disposal costs include all of the following, except

• Legal costs

• Stamps and similar transactions taxes

• Costs of removing the asset

• Finance costs

Recovery of impairment is recognized for all the following except:

• Patent held for sale.

• Patent held for sale.

• Trademark.

• Goodwill.

What is the allocation of an impairment loss recognized for a cash generating unit.

• First, to any goodwill, and the balance to the other assets on a prorata basis based on carrying amount.

• Across the assets of the unit based on carrying amount.

• First, to any goodwill, and the balance to the other assets on a prorata basis based fair value.

• Across the assets of the unit based on fair value.

Which of the following statements is true?

• 1. The capitalizable costs of patents are legal fees and other registration costs.

• An identifiable tangible asset developed internally is never recognized in the accounts as an asset.

• 1. Intangible assets usually have a residual value that must be considered in the amortization of cost.

• 1. An intangible asset is usually amortized by a credit to an income account.

In accordance with the PFRSs, which of the following methods of amortization is normally not recommended for intangible assets?

• 1. Units of production

• 1. Declining balance

• 1. Effective interest method

• 1. Straight line